IF: Blu Ray wins format war THEN: Sony laughs all the way to the bank?

[Crayon]

Alright so we all aknowledge that Sony has willingly made some sacrifices to Playstation marketshare in order to give Blu Ray a leg up in the fat-disk format war. With the highish price and delayed launch and botching of the launch itself, the long term implications on console marketshare fall somewhere between "significant" and "devastating".

However I just thought of something: If Blu Ray wins the format war outright, then where does that leave MS when choosing the format for the XBox3? Please correct me if I'm missing something here, but it looks to me like there on only the following scenarios:

a) Use HD-DVD or a proprietary format. Either would get the job done, but effectivly eschew the console's functionality as a movie player.

b) Note that Oblivion is 4 GB and stick with DVD9.

c) Find some viable alternative to disc media.

d) In an effort to maintain movie player functionality, use a Blu Ray drive and effectivly make money for Sony.

Option D - Could it possibly happen? Would it constitute a masterstroke on Sony's part?

 

[TheChefO]

Alright so we all aknowledge that Sony has willingly made some sacrifices to Playstation marketshare in order to give Blu Ray a leg up in the fat-disk format war. With the highish price and delayed launch and botching of the launch itself, the long term implications on console marketshare fall somewhere between "significant" and "devastating".

However I just thought of something: If Blu Ray wins the format war outright, then where does that leave MS when choosing the format for the XBox3? Please correct me if I'm missing something here, but it looks to me like there on only the following scenarios:

a) Use HD-DVD or a proprietary format. Either would get the job done, but effectivly eschew the console's functionality as a movie player.

b) Note that Oblivion is 4 GB and stick with DVD9.

c) Find some viable alternative to disc media.

d) In an effort to maintain movie player functionality, use a Blu Ray drive and effectivly make money for Sony.

Option D - Could it possibly happen? Would it constitute a masterstroke on Sony's part?

If Bluray is indeed the one and only movie standard by then, obviously the choice would be simple and they would use Bluray for xb720. It would make Sony money in royalties of course and it would hurt their corporate pride but economically it makes sense.

However, IF HD-DVD is still lingering as an option by then and there is cost parity with bluray then I think MS would do whatever they can to continue this format for as long as they can until they establish downloadable content as a viable alternative.

 

[wco81]

They'll do digital distribution then!

That's one of the reasons MS is trying to keep HD-DVD alive at all costs and prolong the war as long as possible.

They don't want to be faced with that scenario, Blu-Ray or DVD9 or nothing.

 

[Ty]

By then, digital distribution may be so robust and prevalent, that physical mediums won't matter.

Edit - DOH. Beaten by a minute!

 

[22psi]

Didn't Sony say PS4 won't have BR?

 

[tongue_of_colicab]

Didn't Sony say PS4 won't have BR?

Yes they said that but 5 or 6 years from now is probably still to early for online distribution only. Far to little broadband connections in alot of homes. Though it would probably work great for a small portion of europe by that time. But you also need shops to sell your consoles and the shops make the most profit on games so not selling your games tru shops will be a big disadvantage because they wont sell your console then.

OT: If BR wins the next xbox will use BR I suppose. For MS it isnt that important wich format wins. One of the biggest reasons to choose HDdvd was probably to annoi sony.

 

[RobertR1]

Blu Ray and HD DVD have more than just eachother to fight. First one must kill off the other. Then they must kill off DVD, which is ridiculously cheaper, looks quite great upscaled (almost HD Lite on a lot of titles). If they can pull that off, they must somehow stay ahead of Digital Distribution. At the rate at which bandwidth increases come and will be coming in the near future, that's quite an uphill battle for either format.

 

[Carl B]

Xbox using a DVD drive makes money for Sony also, y'know? This entire thread premise is off base. Sony won't reap any large rewards for Microsoft using Blu-ray. Hell, if HD DVD fails, expect a Blu-ray add-on to be one of the first new accessory announcements from MS. MS could care less; I think a lot of people are quite uneducated about from whence their support for HD DVD comes; but believe me, they would be happier if both formats died, and digital distribution of HD content on VC-1 became the norm. Pushing their *own* standards is all they care about (which of course makes sense, it's the same for anyone). Of the optical formats, HD DVD is further reliant on said standards than is Blu-ray, which is why they throw their support behind it.

Anyway, if Blu-ray wins of course it will generate a ton of money for Sony. But I don't think the console division has been sacrificed to this end by any stretch. They've had a lot asked of them and they will endure a good bit of pain, but that'll play itself out within two-years probably.

 

[Arwin]

Alright so we all aknowledge that Sony has willingly made some sacrifices to Playstation marketshare in order to give Blu Ray a leg up in the fat-disk format war.

No way. The 360 was going HD DVD, but had to abandon it because the format wasn't ready in time and they needed to get to the market first. I'm still amazed at how effective Microsoft has been at getting everyone to think that sticking with the DVD format was the best option anyway and that having BluRay in the PS3 is because all Sony wanted with the PS3 is cheat us out of our money for BluRay. Major kudos to MS' marketing dept, especially since we have seen a similar scenario earlier in history - it just proves that in this space, 6 years is a long, long time. London-boy, take note! Lessons to be learnt, right there.

 

[RobertR1]

OT: If BR wins the next xbox will use BR I suppose. For MS it isnt that important wich format wins. One of the biggest reasons to choose HDdvd was probably to annoi sony.

It was more to do with MS wanting to cover both platforms and dominate the software layers for the Hi Def formats. The VC-1 codec was adopted by both but that's not their money maker. It's "HDi" the software interactivity layer for HD DVD. Had the BR camp adopted HDi over Java, MS would be fully neutral. Couple that with PS3 hurdles, MS' resolve to support HD DVD kept getting stronger and stronger. Now they're all out for it.

There's a lot more history to the above but that's a brief summary.

 

[Shifty Geezer]

No way. The 360 was going HD DVD, but had to abandon it because the format wasn't ready in time and they needed to get to the market first.

You say that as if it's fact. Can I ask where this insider info comes from?

 

[Dave Baumann]

The 360 was going HD DVD, but had to abandon it because the format wasn't ready in time and they needed to get to the market first.

Where does this come from?

 

[Dave Baumann]

Hell, if HD DVD fails, expect a Blu-ray add-on to be one of the first new accessory announcements from MS.

I'm unconvinced about that, primarily to do with your next statement.

I think one of the motivators for releasing the HD DVD drive was actually to promote the true direction that they want to go in - downloadable content. By popularaising HD DVD as a consumer format they are actually assisting in driving away from allowing a standard to settle, which in turn will prolong the indecision from those not wanting to be burnt by adopting the wrong format. In the meantime, they can push various forms of online content to popularise that further.

I find it of no coincidence that they launch the video marketplace and downloadable TV/Movies at virtually exactly the same time they are readying the HDD DVD drive.

 

[Carl B]

The HD DVD add-on is something Toshiba provides for Microsoft at their own expense, simply as a vector to further promote the format. The possible HD DVD built-in drive was no different; it was Toshiba that was pushing for it, but MS rejected the notion because they saw the develoment/volume/expense issues associated with that route.

Believe me, Microsoft has no interest in putting themselves out financially in this war. They're more like arms dealers with a behind-the-scenes agenda than they are anything else. Behind the scenes in that although Toshiba is their ally in this, Toshiba needs MS more than MS needs Toshiba, and again - it's the digital distribution where MS ultimately wants to take things.

In a world of digital distribution, Toshiba gets hosed. Everyone's using each other though, because no one party is strong enough on their own to push these things through.

 

[Carl B]

I think one of the motivators for releasing the HD DVD drive was actually to promote the true direction that they want to go in - downloadable content. By popularaising HD DVD as a consumer format they are actually assisting in driving away from allowing a standard to settle, which in turn will prolong the indecision from those not wanting to be burnt by adopting the wrong format. In the meantime, they can push various forms of online content to popularise that further.

I'll start in reverse; I agree with this.

I'm unconvinced about that, primarily to do with your next statement.

But here... I just believe that if Blu-ray were to actually firstly win, and secondly gain traction, the downloadable content strategy aside, *not* having a means for playing BD films would indeed seem a lapse in the ability to provide the consumer with the full 'HD' experience. But, perhaps I'm wrong and they would never release a BD player. Especially since there would be no sweetheart OEM deals coming from Sonys direction, that's for sure.

 

[Dave Baumann]

What constitutes a "full HD experience"? With HD Games, HD Movies and video on demand and HD IPTV then there is room to argue that they can offer the full HD experience (without saddling you with a bunch of hardware).

 

[RobertR1]

The HD DVD add-on is something Toshiba provides for Microsoft at their own expense, simply as a vector to further promote the format.

huh? Where did you get this? I can see Toshiba giving them the drive for cost but just to hand it over......For MS, if they're getting the drive at cost, that's all they need. They don't have to pay for VC-1 or HDi licensing costs and clearly use the 360hardware for playback.

Going along with your scenario, even if Toshiba was handing the drives over for free, and even at say $100 cost per drive, that's only 1million for the 100k or so drives sold so far. Hell, even diverting a small chunk of you marketing budget for such a high return on investment, it's a clear win for them.

Again, unless we have some hard evidence for this, we should refrain for assuming corporate deals that go on in private. Really, if we keep doing this we can have a ton of scenarios from both sides to entertain.

 

[ban25]

What constitutes a "full HD experience"?

The ability to play high quality 1080p movies, for one...

 

[Shifty Geezer]

huh? Where did you get this? I can see Toshiba giving them the drive for cost but just to hand it over......For MS, if they're getting the drive at cost, that's all they need.

I think that's what xbd means. MS have no expense in this endeavour as they get the money back on the sale of the drives at $200. Assuming the drives are being sold at a loss, that loss is born by Toshiba. Thus it's at Toshiba's expense that the drive is provided, and no expense to MS. This is all speculation though.

 

[habbe]

Going along with your scenario, even if Toshiba was handing the drives over for free, and even at say $100 cost per drive, that's only 1million for the 100k or so drives sold so far. Hell, even diverting a small chunk of you marketing budget for such a high return on investment, it's a clear win for them.

That's 10million.